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United States Government Accountability Office:
GAO:
Testimony:
Before the Subcommittee on Employment and Workplace Safety, Committee
on Health, Education, Labor and Pensions, U.S. Senate:
For Release on Delivery:
Expected at 10:00 a.m. EDT:
Thursday, February 16, 2012:
Workforce Investment Act:
Innovative Collaborations between Workforce Boards and Employers
Helped Meet Urgent Local Workforce Needs:
Statement of Andrew Sherrill, Director:
Education, Workforce, and Income Security:
GAO-12-419T:
Chairwoman Murray, Ranking Member Isakson, and Members of the
Subcommittee:
I am pleased to be here today to discuss collaboration between
workforce boards, employers, and others. As the United States
continues to face high unemployment in the wake of the recent
recession, federally funded workforce programs can play an important
role in bridging gaps between the skills present in the workforce and
the skills needed for available jobs. However, there is growing
recognition that these programs need to better collaborate with
employers to align services and training with employers' needs. As you
know, the Workforce Investment Act of 1998 (WIA)[Footnote 1]
envisioned such collaboration by focusing on employers as well as
jobseekers, establishing a "dual customer" approach. To create a
single, comprehensive workforce investment system, WIA required that
16 programs administered by four federal agencies--the Departments of
Labor (Labor), Education, Health and Human Services, and Housing and
Urban Development--provide access to their services through local one-
stop centers, where jobseekers, workers, and employers can find
assistance at a single location.[Footnote 2] In addition, WIA sought
to align federally funded workforce programs more closely with local
labor market needs by establishing local workforce investment boards
to develop policy and oversee service delivery for local areas within
a state and required that local business representatives constitute
the majority membership on these boards.[Footnote 3] Today, about 600
local workforce boards oversee the service delivery efforts of about
1,800 one-stop centers that provide access to all required programs.
[Footnote 4]
Despite the vision of collaboration between local employers and the
workforce investment system, we and others have found that
collaboration can be challenging. For example, in previous reports, we
found that some employers have limited interaction with or knowledge
of this system and that employers who do use the one-stop centers
mainly do so to fill their needs for low-skilled workers.[Footnote 5]
My remarks today are based on our report, which was released
yesterday, entitled Workforce Investment Act: Innovative
Collaborations between Workforce Boards and Employers Helped Meet
Local Needs.[Footnote 6] We examined promising practices for
collaboration between workforce investment boards, employers,
education providers, and others that have demonstrated positive
results. Specifically, we examined (1) the factors that facilitated
innovative collaborations among workforce boards, employers, and
others; (2) the major challenges to collaboration; and (3) what
actions the Department of Labor has taken to support local workforce
boards in their collaborative efforts.
To answer these questions, we asked officials from five federal
agencies[Footnote 7] and national workforce and economic development
experts from 20 organizations to nominate what they viewed as the most
promising or innovative initiatives in which local workforce boards
collaborated effectively with employers and other partners to achieve
positive results. From over 89 nominations, covering 28 states, we
selected 14 initiatives in 13 local areas for in-depth review. The
criteria for our selection included the number of nominations for each
initiative, diversity of federal funding sources, variety of local
unemployment rates, evidence of replicability, and geographical
diversity, among others. We interviewed state and local workforce
officials, representatives of educational institutions, training
providers, economic development officials, employers, and others. We
also interviewed officials from the Departments of Labor and Commerce,
as well as representatives of workforce associations. We also reviewed
relevant federal laws, regulations, and other documents pertaining to
the key federal programs. We conducted our work between November 2010
and January 2012 in accordance with generally accepted government
auditing standards. Those standards require that we plan and perform
the audit to obtain sufficient, appropriate evidence to provide a
reasonable basis for our findings and conclusions based on our audit
objectives. We believe that the evidence obtained provides a
reasonable basis for our findings and conclusions based on our audit
objectives.
In summary, workforce board officials and their partners in the 14
initiatives cited a range of factors that facilitated building
innovative collaborations. Almost all of the collaborations grew out
of efforts to address urgent workforce needs of multiple employers in
a specific sector, rather than focusing on individual employers. The
partners in these initiatives made extra effort to engage employers so
they could tailor services such as jobseeker assessment, screening,
and training to address specific employer needs. In all the
initiatives, partners remained engaged in these collaborations because
they continued to produce a wide range of reported results, such as an
increased supply of skilled labor, job placements, reduced employer
recruitment and turnover costs, and averted layoffs. While these
boards were successful in their efforts, they cited some challenges to
collaboration that they needed to overcome. Some boards were
challenged to develop comprehensive strategies to address diverse
employer needs with WIA funds. For example, some boards' staff said
that while their initiatives sought to meet employer needs for higher-
skilled workers through skill upgrades, WIA funds can be used to train
current workers only in limited circumstances, and the boards used
other funding sources to do so. Staff from most, but not all, boards
also said that WIA performance measures do not reflect their efforts
to engage employers, and many boards used their own measures to assess
their services to employers. Labor has taken various steps to support
local collaborations, such as conducting webinars and issuing guidance
on pertinent topics, and contributing to a new federal grant program
to facilitate innovative regional collaborations. Yet, while many
boards cited leveraging resources as a key to facilitating
collaboration, Labor has not compiled pertinent information on
effective practices for leveraging resources and made it easy to
access.
Several Key Factors Supported Initial Collaboration and Sustained It
over Time:
While the 14 selected initiatives varied in terms of their purpose,
sector, and partners involved, the boards and their partners cited
common factors that facilitated and sustained collaboration. These
were (1) a focus on urgent, common needs; (2) leadership; (3) the use
of leveraged resources; (4) employer-responsive services; (5)
minimizing administrative burden; and (6) results that motivated the
partners to continue their collaboration.
With regards to focusing on urgent, common needs, almost all of the
collaborations grew out of efforts to address urgent workforce needs
of multiple employers in a specific sector, such as health care,
manufacturing, or agriculture, rather than focusing on individual
employers (see table 1). The urgent needs ranged from a shortage of
critical skills in health care and manufacturing to the threat of
layoffs and business closures. In San Bernardino, California, for
example, some companies were at risk of layoffs and closures because
of declining sales and other conditions, unless they received services
that included retraining for their workers.[Footnote 8] In one case,
employers in Gainesville, Florida, joined with the board and others to
tackle the need to create additional jobs by embarking on an
initiative to develop entrepreneurial skills.
Table 1: Fourteen Initiatives Addressed a Range of Urgent Employer
Needs:
Initiative name: 1. ManufacturingWorks;
Workforce board[A]: Chicago, Illinois;
Sector focus: Manufacturing;
Needs addressed[B]: Critical skill needs.
Initiative name: 2. Health Careers Collaborative of Greater Cincinnati;
Workforce board[A]: Cincinnati, Ohio;
Sector focus: Health care;
Needs addressed[B]: Critical skill needs, turnover.
Initiative name: 3. Entrepreneurship Quests;
Workforce board[A]: Gainesville, Florida;
Sector focus: No single sector;
Needs addressed[B]: Need for additional jobs[C].
Initiative name: 4. Advanced Manufacturing Training Initiative;
Workforce board[A]: Golden, Colorado;
Sector focus: Manufacturing;
Needs addressed[B]: Soft skills[D].
Initiative name: 5. Piedmont Triad Global Logistics Workforce
Initiative;
Workforce board[A]: Greensboro, North Carolina;
Sector focus: Transportation, distribution, and logistics;
Needs addressed[B]: Critical skill needs.
Initiative name: 6. Center of Excellence in Production Agriculture;
Workforce board[A]: Lancaster, Pennsylvania;
Sector focus: Agriculture;
Needs addressed[B]: Critical skill needs.
Initiative name: 7. Career Pathways;
Workforce board[A]: Madison, Wisconsin;
Sector focus: Multiple;
Needs addressed[B]: Critical skill needs.
Initiative name: 8. Pre-employment Healthcare Academy;
Workforce board[A]: Rochester, Minnesota;
Sector focus: Health care (long-term care);
Needs addressed[B]: Turnover, soft skills[D].
Initiative name: 9. Technical Employment Training;
Workforce board[A]: San Bernardino, California[E];
Sector focus: Manufacturing;
Needs addressed[B]: Critical skill needs.
Initiative name: 10. Manufacturing Sector Layoff Aversion and Business
Assistance Initiative;
Workforce board[A]: San Bernardino, California[E];
Sector focus: Manufacturing;
Needs addressed[B]: Imminent threat of layoffs.
Initiative name: 11. Health Care Sector Panel;
Workforce board[A]: Seattle, Washington;
Sector focus: Health care;
Needs addressed[B]: Critical skill needs.
Initiative name: 12. Michigan Academy for Green Mobility Alliance;
Workforce board[A]: Taylor, Michigan (southeast Michigan);
Sector focus: Manufacturing;
Needs addressed[B]: Need for upgraded skills to keep pace with
technological change.
Initiative name: 13. NoVaHealthForce;
Workforce board[A]: Vienna, Virginia (Northern Virginia);
Sector focus: Health care;
Needs addressed[B]: Critical skill needs.
Initiative name: 14. Composites Kansas WIRED Initiative;
Workforce board[A]: Wichita, Kansas;
Sector focus: Manufacturing (aviation);
Needs addressed[B]: Need for upgraded skills to keep pace with
technological change.
Source: GAO.
[A] The boards are identified by the city in which they are located.
For the initiatives that involved multiple workforce boards, the city
shown is the location of the lead workforce board. For the boards'
complete names, see our report.
[B] A single initiative could address more than one common need. The
needs shown represent the main needs identified by the partners.
[C] This initiative addressed the area's need for new employment
opportunities through a strategy of promoting self-employment.
[D] Soft skills are the nontechnical skills that workers need to
function in a job, and include competencies related to problem-
solving, oral communication, personal qualities, work ethic, and
teamwork skills.
[E] Two initiatives of this board, both in manufacturing, were
selected.
[End of table]
According to those we interviewed, by focusing on common employer
needs across a sector, the boards and their partners produced
innovative labor force solutions that, in several cases, had evaded
employers who were trying to address their needs individually. In
several cases, employers cited the recruitment costs they incurred by
competing against each other for the same workers. By working together
to develop the local labor pool they needed, the employers were able
to reduce recruitment costs in some cases.
Boards also facilitated collaboration by securing leaders who had the
authority or the ability, or both, to persuade others of the merits of
a particular initiative, as well as leaders whose perceived neutrality
could help build trust. Officials from many initiatives emphasized the
importance of having the right leadership to launch and sustain the
initiative. For example, in Northern Virginia, a community college
president personally marshaled support from area hospital chief
executive officers and local leaders to address common needs for
health care workers.
Another factor that facilitated collaboration was the use of leveraged
resources. All of the boards and their partners we spoke with launched
or sustained their initiatives by leveraging resources in addition to
or in lieu of WIA funds. In some cases, partners were able to use
initial support, such as discretionary grants, to attract additional
resources. For example, in Golden, Colorado, the board leveraged a
Labor discretionary grant of slightly more than $285,000 to generate
an additional $441,000 from other partners. In addition to public
funds, in all cases that we reviewed, employers demonstrated their
support by contributing cash or in-kind contributions.
In all cases, boards and their partners provided employer-responsive
services to actively involve employers and keep them engaged in the
collaborative process. Some boards and their partners employed staff
with industry-specific knowledge to better understand and communicate
with employers. In other initiatives, boards and partners gained
employers' confidence in the collaboration by tailoring services such
as jobseeker assessment and screening services to address specific
employers' needs. For example, a sector-based center in Chicago,
Illinois, worked closely with employers to review and validate
employers' own assessment tools, or develop new ones, and administer
them on behalf of the employers, which saved employers time in the
hiring process. Boards and their partners also strengthened
collaborative ties with employers by making training services more
relevant and useful to them. In some cases, employers provided direct
input into training curricula. For example, in Wichita, Kansas,
employers from the aviation industry worked closely with education
partners to develop a training curriculum that met industry needs and
integrated new research findings on composite materials. Another way
that some initiatives met employers' training needs was to provide
instruction that led to industry-recognized credentials. For example,
in San Bernardino, a training provider integrated an industry-
recognized credential in metalworking into its training program to
make it more relevant for employers.
Boards also made efforts to minimize administrative burden for
employers and other partners. In some cases, boards and their partners
streamlined data collection or developed shared data systems to
enhance efficiency. For example, in Cincinnati, Ohio, the partners
developed a shared data system to more efficiently track participants,
services received, and outcomes achieved across multiple workforce
providers in the region.
Finally, partners remained engaged in these collaborative efforts
because they continued to produce a range of results for employers,
jobseekers and workers, and the workforce system and other partners,
such as education and training providers. For employers, the
partnerships produced diverse results that generally addressed their
need for critical skills in various ways. In some cases, employers
said the initiatives helped reduce their recruitment and retention
costs. For example, in Cincinnati, according to an independent study,
employers who participated in the health care initiative realized
about $4,900 in cost savings per worker hired. For jobseekers and
workers, the partnerships produced results that mainly reflected job
placement and skill attainment. For example, in Wichita, of the 1,195
workers who were trained in the use of composite materials in aircraft
manufacturing, 1,008 had found jobs in this field. For the workforce
system, the partnerships led to various results, such as increased
participation by employers in the workforce system, greater
efficiencies, and models of collaboration that could be replicated.
Specifically, officials with several initiatives said they had
generated repeat employer business or that the number and quality of
employers' job listings had increased, allowing the workforce system
to better serve jobseekers.
Workforce Boards Overcame Some Challenges to Address Diverse Employer
Needs and Developed Their Own Measures to Track Employer Engagement:
While these boards were successful in their efforts, they cited some
challenges to collaboration that they needed to overcome. Some boards
were challenged to develop comprehensive strategies to address diverse
employer needs with WIA funds. WIA prioritizes funding for intensive
services and training for low-income individuals when funding for
adult employment and training activities is limited.[Footnote 9] The
director of one board said that pursuing comprehensive strategies for
an entire economic sector can be challenging, because WIA funds are
typically used for lower-skilled workers, and employers in the region
wanted to attract a mix of lower-and higher-skilled workers. To
address this challenge, the director noted that the board used a
combination of WIA and other funds to address employers' needs for a
range of workers. Additionally, some boards' staff said that while
their initiatives sought to meet employer needs for skill upgrades
among their existing workers, WIA funds can be used to train current
workers only in limited circumstances, and the boards used other
funding sources to do so. Among the initiatives that served such
workers, the most common funding sources were employer contributions
and state funds.
In addition, staff from most, but not all, boards also said that WIA
performance measures do not directly reflect their efforts to engage
employers. Many of these boards used their own measures to assess
their services to employers, such as the number of new employers
served each year, the hiring rate for jobseekers they refer to
employers, the interview-to-hire ratio from initiative jobseeker
referrals, the retention rate of initiative-referred hires, the number
of businesses returning for services, and employer satisfaction.
[Footnote 10]
Labor Has Taken Steps to Support Local Collaborative Efforts and
Address Some Challenges but Has Not Made Information on Leveraging
Resources Readily Available:
In order to support local collaborations like these, Labor has
conducted webinars and issued guidance on pertinent topics, and has
also collaborated with other federal agencies in efforts that could
help support local collaboration. For example, Labor is working with
the Department of Education and other federal agencies to identify
existing industry-recognized credentials and relevant research
projects,[Footnote 11] and has issued guidance to help boards increase
credential attainment among workforce program participants.[Footnote
12] In addition, Labor has recently worked with Commerce and the Small
Business Administration to fund a new discretionary $37 million grant
program called the Jobs and Innovation Accelerator Challenge to
encourage collaboration and leveraging funds. Specifically, this
program encourages the development of industry clusters, which are
networks of interconnected firms and supporting institutions that can
help a region create jobs. A total of 16 federal agencies will provide
technical resources to help leverage existing agency funding,
including the 3 funding agencies listed above.[Footnote 13]
While Labor has taken some steps to support local collaborations, it
has not made information it has collected on effective practices for
leveraging resources easily accessible, even though many of the boards
we reviewed cited leveraging resources as a key to facilitating
collaboration. For example, Labor maintains a website for sharing
innovative state and local workforce practices called Workforce3One,
which has some examples of leveraging funding at the local
level.[Footnote 14] However, the website does not group these examples
together in an easy to find location, as it does for other categories
such as examples of innovative employer services or sector-based
strategies.[Footnote 15] Moreover, although certain evaluations and
other research reports have included information on leveraging
resources,[Footnote 16] this information has not been compiled and
disseminated in one location.
In conclusion, at a time when the nation continues to face high
unemployment, it is particularly important to consider ways to better
connect the workforce investment system with employers to meet local
labor market needs. The 14 local initiatives that we reviewed
illustrate how workforce boards collaborated with partners to help
employers meet their needs and yielded results: critical skill needs
were met, individuals obtained or upgraded their skills, and the local
system of workforce programs was reinvigorated by increased employer
participation. Labor has taken several important steps that support
local initiatives like the ones we reviewed through guidance and
technical assistance, and through collaborative efforts with other
federal agencies. However, while Labor has also collected relevant
information on effective strategies that local boards and partners
have used to leverage resources, it has not compiled this information
or made it readily accessible. As the workforce system and its
partners face increasingly constrained resources, it will be important
for local boards to have at their disposal information on how boards
have effectively leveraged funding sources. In our report, we
recommended that Labor compile information on workforce boards that
effectively leverage WIA funds with other funding sources and
disseminate this information in a readily accessible manner. In its
comments on our draft report, Labor agreed with our recommendation and
noted its plans to implement it.
This concludes my prepared statement. I would be happy to answer any
questions that you or others members of the subcommittee may have.
GAO Contact and Acknowledgments:
For further information regarding this testimony, please contact
Andrew Sherrill (202-512-7215 or sherrilla@gao.gov. Contact points for
our Offices of Congressional Relations and Public Affairs may be found
on the last page of this statement. Individuals who made key
contributions to this testimony include Laura Heald (Assistant
Director), Chris Morehouse, Jessica Botsford, Jean McSween, and David
Chrisinger.
[End of section]
Footnotes:
[1] Pub. L. No. 105-220, 112 Stat. 936 (codified at 29 U.S.C. § 2801
et seq.).
[2] 29 U.S.C. § 2841(b). Although WIA required 17 programs to
participate in the one-stop system, the Welfare-to-Work program no
longer exists, reducing the total to 16 mandatory programs.
[3] 29 U.S.C. § 2832(a) and (b)(4).
[4] In addition to the one-stop centers that provide access to all
programs, over 1,000 other one-stop centers, known as affiliate
centers, provide limited employment and training-related services to
job seekers and employers.
[5] See GAO, Workforce Investment Act: Employers Are Aware of, Using,
and Satisfied with One-Stop Services, but More Data Could Help Labor
Better Address Employers' Needs, [hyperlink,
http://www.gao.gov/products/GAO-05-529R] (Washington, D.C.: Feb. 18,
2005). This report found that about half of employers were not aware
of their local one-stops, and that this was more common among smaller
companies. Also, see GAO, Workforce Investment Act: Employers Found
One-Stop Centers Useful in Hiring Low-Skilled Workers; Performance
Information Could Help Gauge Employer Involvement, [hyperlink,
http://www.gao.gov/products/GAO-07-167] (Washington, D.C.: Dec. 22,
2006).
[6] GAO, Workforce Investment Act: Innovative Collaborations between
Workforce Boards and Employers Helped Meet Local Needs, [hyperlink,
http://www.gao.gov/products/GAO-12-97] (Washington, D.C.: Jan. 19,
2012).
[7] In addition to the Departments of Labor, Education, Health and
Human Services, and Housing and Urban Development, which administer
one-stop programs, we also requested nominations from the Department
of Commerce, which administers key economic development programs.
[8] According to Labor, averting layoffs is one of the functions of
the workforce investment system, and worker training, such as training
for workers in new processes or technologies, is one of several
services that can help employers avoid layoffs. Labor has encouraged
states to establish criteria to identify the employers and workers for
whom layoff aversion services may be appropriate. States that seek to
use WIA funds to avert layoffs must obtain waivers from Labor. See
Department of Labor, Training and Employment Guidance Letter No. 30-09.
[9] 29 U.S.C. § 2864(d)(4)(E).
[10] These examples are consistent with prior GAO work. In a 2004
report, we found that about 70 percent of local areas nationwide
reported that they required one-stop centers to track some type of
employer measure, such as the number of employers that use one-stop
services, how many hire one-stop customers, and the type of services
that employers use. See GAO, Workforce Investment Act: States and
Local Areas Have Developed Strategies to Assess Performance, but Labor
Could Do More to Help, [hyperlink,
http://www.gao.gov/products/GAO-04-657] (Washington, D.C.: June 1,
2004).
[11] According to the Department of Education, The National Center for
Education Statistics has convened a federal interagency working group
to develop better survey measures of the prevalence of industry-
recognized certifications and licenses and educational certificates in
the United States adult population.
[12] See Department of Labor, Training and Employment Guidance Letter
No 15-10 (Washington, D.C.: 2010).
[13] In September 2011, Labor announced the 20 regions that will
receive grant funds. Labor estimates the grants will result in the
creation of 4,800 jobs.
[14] See [hyperlink, http://www.workforce3one.org].
[15] There are 14 "super categories," on the site, such as
apprenticeship, clusters, community colleges, entrepreneurship,
disability, nonprofit, and youth services.
[16] For example, see The Urban Institute, Characteristics of the
Community-Based Job Training Grant Program, prepared for the
Department of Labor (Washington, D.C.: 2009). Also see Public Policy
Associates Incorporated, Nurturing America's Growth in the Global
Marketplace through Talent Development: An Interim Report on the
Evaluation of Generations II and III of WIRED, prepared for the
Department of Labor (Lansing, Michigan: 2009), and Social Policy
Research Associates, Literature Review: Business/Faith-Based and
Community Organization Partnerships, prepared for the Department of
Labor (Washington, D.C.: 2006).
[End of section]
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